GnuCash User Manual
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# The Rule of Double-Entry Accounting

In a double-entry transaction, an equal amount of money is always transferred from one account (or group of accounts) to another account (or group of accounts). Accountants use the terms debit and credit to describe whether money is being transferred to or from an account.

Money is recorded in the debit column, which is the left column, when it is being transferred to an account. Money is recorded in the credit column, which is the right column, when it is being transferred from an account. For every transaction, the total of debits (left column entries) must equal the total of credits (right column entries).

You don't have to use the terms "debit" and "credit" to use GnuCash, however. GnuCash registers default to "common" column headings such as "deposit" and "withdrawal"---if you are more comfortable with those headings, use them. If you prefer the credit and debit headings, you can change the column headings to "use accounting labels" from the menu item Settings|Preferences...General.

The main concept to remember, regardless of terminology, is that all transactions involve a transfer of some amount of money from a source to a destination. For example, if you write a check for $50 to buy groceries, you record that as a transfer of $50 from the checking account to the groceries expense account. In accounting terms, this is a credit to checking and a debit to groceries expense:

Debit Groceries 50
Credit Checking 50

What about your paycheck? You can see that money goes into a bank account, but where does it come from? In double-entry, the money has to have a source, and the source of your paycheck is an income account. So to enter the deposit of a $500 paycheck in your checking account, you record a transfer of $500 from an income account to a checking account. In accounting terms, this is a credit to income and a debit to the bank account:

Debit Checking 500
Credit Income 500

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